Jordan's Value To Chicago? Up To $1 Billion

Trickle-down economics may not necessarily have worked in the Reagan-Bush era, but something very much like it seems to be happening in the Chicago region these days.

It works like this:

A 21-year-old All-America college basketball star named Michael Jordan becomes the highest paid player in Chicago Bulls history when he joins the lackluster team in 1984.

Defying gravity on the court, he starts winning games and lures more than 400,000 new fans to Chicago Stadium each year. Jordan makes millions on endorsements, and the franchise's value increases tenfold in eight years.

In turn, all that good fortune spills over to the vendors serving Chicago Stadium, and outside to the T-shirt sellers, parking lot attendants and nearby restaurants.

Major employers have benefited from their association with Jordan, from local giants-like McDonald's Corp. and Quaker Oats Co., which owns Gatorade-to the Chicago ad agencies, such as Leo Burnett Co., that get additional business by staging his commercials.

And finally, more tourists stream into the city to visit the place where he works and lives.

In all, the Jordan persona, by some estimates, may be worth as much as $1 billion to the region's economy.

"It's almost incalculable," said John Skorburg, chief economist for the Chicagoland Chamber of Commerce. "But I wouldn't be surprised if it approached a billion."

Looked at another way, if Bulls fans had put up the original $4.5 million the team owners agreed to pay Jordan in 1984 for a five-year contract, they'd be looking at a more than 22,000 percent return on their investment.

"Through Michael Jordan, Chicago has come onto the national and world scene in a way that none of the previous efforts to market Chicago have been able to accomplish," said George Rosenbaum, chief executive of retail consulting firm Leo J. Shapiro & Associates.

Much has been made of Jordan's role in boosting both the Bulls' bottom line (the franchise's worth has increased to $105 million from $18.7 million in 1985, according to Financial World magazine, though others say its current value is closer to $200 million) and his own (the estimated few million dollars in salary and the believed-to-be $35 million in advertising endorsements he earns each year).

And just the hoopla around the Bulls' "three-peat" probably generated $280 million for the local economy, according to Skorburg's estimates.

But Jordan has had an even more enduring economic impact on the area-starting at home, at Chicago Stadium, and reaching overseas, where he now personifies the city.

Here are a few examples of his reach:

- Over 10 postseason games this year, $57 million was spent to produce the games and by fans at Chicago Stadium for tickets, food, souvenirs and hotel accommodations, Skorburg said. Since before Jordan's first 1984-85 season, average attendance has jumped from 6,365 in 1983-84 to more than 18,500 this season.

If you make a conservative estimate that 20 percent of the fans in recent years attended Bulls games specifically to see Jordan, "that would turn out to be about $1 million more per game in ticket sales, food, beverages, transportation, parking and souvenirs," Skorburg said. Multiply that by the 294 straight sellouts and you have $294 million.

Steve Cohen, president of Andy Frain Services Inc., said he has had to increase the number of ushers at Bulls games from 50 to 150 for the last several years.

- Then there's United Center, the new home of the Bulls and Blackhawks, which most agree would never have happened without Jordan. Most of the financing for the $175 million project, under construction next to Chicago Stadium, is coming from private-versus taxpayer-money, from a consortium of Chicago and Japanese banks.

Its construction, started in the spring of 1992 and scheduled for completion in 1994, will employ from 1,500 to 2,000 different construction workers and craftsmen by the time it's finished, but no more than 350 at any given time, said Jim Ladd, senior project manager. Add the $5 a day each worker spends on lunch to their base wage of $18 to $25 an hour, and there's up to $10,000 a day added to the economy right there.

The Bulls-Blackhawks venture plans to invest another $4 million in private money for new housing and to develop the decaying area around the new facility near the existing stadium on West Madison Street. Another $4.2 million in city and federal funds will be used to help the effort and to redo a park and library in the neighborhood.

Farther east, in the more glamorous world of the Loop, the River North area and Michigan Avenue, the Jordan image is generating money at his own restaurant on North LaSalle Street and at Nike Town on Michigan Avenue, as well as at the headquarters of Sara Lee Corp. and Quaker Oats, among other corporate locales.